By Troy Palmer, Partner, and Isobel Feben, Associate
The Coronavirus has focused our attention on the need to elevate estate planning on our list of priorities.
The usual considerations are relevant during these times such as estate assets, succession of non estate assets such as companies, trusts and superannuation, appointment of executors and guardians and contemplating the beneficiaries of estates. However, the COVID-19 crisis is drawing attention to the following particular issues:
- Your family may be exposed to greater business risk or risk of bankruptcy and insolvency. Additional asset protection measures may be appropriate to protect any planned inheritance.
- Separation and divorce rates usually spike during times of economic difficulty – therefore you may wish to consider inheritance protection measures for beneficiaries in relationships.
- If you are providing financial assistance to family members, make sure that an appropriate structure is used to protect any such advance. This may involve, for example, a properly constructed loan contract with security, if applicable.
- The value of your assets may have diminished. This should be taken into account, especially where there have been specific gifts of assets. Similarly, superannuation balances may have diminished and a review of nominations to align with the overall estate plan becomes paramount.
- Are there beneficiaries who now have a greater need due to health problems or loss of employment? Reviewing estate planning in light of this is important and may well mitigate potential challenges to the estate.
- Insurances should be reviewed and potentially increased to boost estate assets as a strategy to make adequate provision.
- Imagine that you find yourself in Intensive Care or you are otherwise unable to make financial, medical and legal decisions yourself. Do you have the relevant documentation in place for someone else to manage your affairs? Did you know that your self-managed super fund may become non-compliant should the appropriate measures around incapacity not be in place?
The above is a snapshot of just some of the issues we are confronting at present.
The estate planning team at Mills Oakley is well placed to assist you during these times and have made the appropriate adjustments to our processes to help you put your affairs in order.
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